Supreme Court Asked to Consider Immoral or Scandalous Trademarks

Previously, I wrote about changes in the landscape for disparaging trademarks in the first year since the U.S. Supreme Court’s decision in Matal v. Tam, 137 S. Ct. 1744 (June 19, 2017). In that article, I mentioned a related issue concerning the portion of Lanham Act Section 2(a) that permits the U.S. Patent and Trademark Office (USPTO) to refuse registration of a mark that “[c]onsists of or comprises immoral . . . or scandalous matter.” In December 2017, a Federal Circuit panel held that the “immoral . . . or scandalous” clause is an unconstitutional violation of the First Amendment’s free speech clause.  In re Brunetti, 877 F.3d 1330 (Fed. Cir. Dec. 15, 2017). As expected, on September 7, 2018, the government filed a petition for writ of certiorari in the case, which is now captioned Iancu v. Brunetti, U.S. Supreme Court Case No. 18-302.

The case involves Eric Brunetti’s clothing brand, called FUCT. Although Brunetti has marketed various apparel under the FUCT mark since the early 1990s, the application at issue in this case was filed in 2011. The examiner rejected the application under Section 2(a), finding that FUCT “is the past tense of F*CK,” and “is scandalous because it is disparaging and [] total[ly] vulgar.” The Trademark Trial and Appeal Board agreed, finding that “the Trademark Examining Attorney has shown by a preponderance of the evidence that a substantial composite of the general public would find this designation vulgar.”

After Brunetti arrived at the Federal Circuit, the U.S. Supreme Court entered its decision in Tam, striking down the Lanham Act’s ban on registration of “disparaging” trademarks as unconstitutional.  In the wake of Tam, the Federal Circuit solicited supplemental briefs and re-argument in the Brunetti case.  The Federal Circuit panel then concluded that the “immoral . . . or scandalous” clause in Section 2(a) similarly violates the First Amendment.  Importantly, however, while the Tam decision was based on improper viewpoint discrimination, the Brunetti majority wrote, “[i]ndependent of whether the immoral or scandalous provision is viewpoint discriminatory, we conclude that the provision impermissibly discriminates based on the content in violation of the First Amendment.”

In its September 7, 2018 petition for a writ of certiorari, the government first asserts that Tam is not controlling in Brunetti. The government argues that the eight justices who decided Tam all agreed on the result, but “[n]o rationale garnered the assent of a majority of the Court.” The government raises some key questions left open by Tam, such as whether trademark registration qualifies as a “government subsidy” or as “commercial speech,” both of which could impact the level of constitutional scrutiny that should be applied to the Lanham Act. The government also suggests that Tam is not controlling because it was decided on viewpoint grounds, whereas a ban on vulgar or obscene expression is viewpoint-neutral.

The government also asserts that Section 2(a) does not restrict speech. Indeed, trademark rights accrue through use, not registration, and the Lanham Act provides protections and remedies to the owners of unregistered marks.  While the government recognizes that the Lanham Act provides certain additional benefits to registration, it argues that the inability to register a mark does not prevent the owner from using the mark, and therefore, Section 2(a) is not a restriction on speech.

The government then argues that the “immoral . . . or scandalous” clause is a lawful eligibility requirement for a federal benefit. While the First Amendment does not permit government restrictions on speech, it also does not confer an affirmative right to government assistance in speaking. The government asserts that Congress made a constitutional policy decision by fully permitting the use of “immoral . . . or scandalous” marks, but declining to use government funds to “confer[] statutory benefits for use of vulgar words and lewd sexual images.” The government also argues that the Federal Circuit erred in refusing to apply the “government subsidy” line of cases and by drawing parallels between trademark and copyright registration. Finally, the government offered “legitimate justifications” for the “immoral . . . or scandalous” clause in an attempt to overcome whatever level of constitutional scrutiny the Supreme Court might apply.

The government concludes its petition by arguing that the question presented is important because if the Federal Circuit’s decision is allowed to stand, there would be “no meaningful likelihood that any further dispute concerning the constitutionality of the scandalous-marks provision will again be presented for judicial resolution.” Indeed, because the Federal Circuit struck down that provision, the USPTO will no longer be able to refuse registration under the “immoral . . . or scandalous” marks clause. For the issue to reach the courts again, Congress would need to enact a new but similar restriction on registration under the Lanham Act, and then a disappointed applicant would need to appeal a refusal under that provision. That process could take many years. Accordingly, irrespective of the government’s position on the merits, it raises a very strong argument for the U.S. Supreme Court to take the case and provide certainty on this issue.

If Brunetti chooses to respond to the government’s petition, his brief is due October 9, 2018. Amicus briefs are also likely, given the substantial attention this case has received, and those will be due October 9, 2018, as well. Any reply brief from the government will be due 14 days after the response.

As I discussed in my earlier piece, many companies have generated significant brand attention and driven overall brand value by pushing the envelope. If the U.S. Supreme Court agrees to hear the Brunetti case, it could have a substantial impact on “shock value” marks in commerce.

Image Source: Deposit Photos


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